Samsung Electronics’ subsidiary Harman has taken on the role of a hidden benefactor. (Image courtesy of Yonhap)
SEOUL, Nov. 1 (Korea Bizwire) – Samsung Electronics’ subsidiary Harman has taken on the role of a hidden benefactor, as it announced its most significant quarterly operating profit ever in the third quarter of this year.
On Tuesday, Samsung Electronics released its third-quarter earnings report, revealing that Harman achieved sales of 3.8 trillion won and an operating profit of 450 billion won.
The company surpassed its previous highest fourth-quarter operating profit (370 billion won) from last year, thanks to increased orders from military customers and strong sales of consumer audio and video products such as portable speakers.
In fact, Harman’s operating profit for the third quarter of this year exceeded its annualized operating profit for 2017 (60 billion won), 2018 (160 billion won), 2019 (320 billion won), and 2020 (60 billion won). The company’s cumulative operating profit for the first three quarters of the year stands at 830 billion won.
Last year, Harman achieved a record-breaking annual sales figure of 13.21 trillion won and an operating profit of 880 billion won.
Given Samsung Electronics’ overall revenue decline of more than 20 percent due to challenges in its core semiconductor industry, Harman’s robust performance provides a much-needed boost.
In the third quarter, Harman contributed to 22 percent of Samsung’s total profit and 5.5 percent of its revenue. This achievement can be attributed to Harman’s strategy of focusing on high-end, high-specification products, particularly for premium vehicles.
One of Harman’s flagship products, the Digital Cockpit, saw production of 4.1 million units in the first half of this year, marking a 3.8 percent increase from the 3.95 million units produced in the first half of last year.
Harman is renowned as an industry leader for in-car infotainment and car audio, supplying car audio systems to a wide range of automotive brands, including Toyota, Lexus, BMW, Renault, Audi, and Volvo. Today, more than 50 million vehicles worldwide are equipped with Harman’s car audio and connected car systems.
Since its acquisition by Samsung Electronics in 2017, Harman has effectively leveraged Samsung’s IT technology capabilities, especially in software development.
Harman has emerged as a leader in the digital cockpit sector, spearheading the adoption of Android-based digital cockpits by tapping into Samsung’s Android development expertise.
Additionally, Harman has introduced the industry’s first 5G product for car communication units (TCUs), the core equipment for home, mobile, and car connectivity. Following its supply of 5G TCUs to BMW for the iX luxury electric sports utility vehicle (SUV) in 2021, the company is witnessing a surge in orders for these advanced units.
Furthermore, Harman is a pioneer in the field of in-vehicle infotainment, specializing in developing tailored displays for vehicles.
Harman’s overarching strategy revolves around providing in-car occupant experience (ICX) solutions centered on digital cockpits and leading the transformation of the market.
Kevin Lee (kevinlee@koreabizwire.com)
